Baguio hospital ordered to refund over P900K of excess charges to senior citizens after Court of Appeals ruling

Baguio City, Philippines – The Court of Appeals (CA) has upheld the rights of senior citizens to mandatory healthcare discounts and tax exemptions, ordering a Baguio-based hospital to refund more than P900,000 in excess charges collected from elderly patients.

Under the Expanded Senior Citizens Act of 2010 (Republic Act No. 9994), senior citizens are entitled to a 20-percent discount and exemption from the 12-percent value-added tax (VAT) on medical and healthcare services, including hospital charges, professional fees of attending physicians, and other qualified health-related expenses.

In a decision dated June 18, the CA's Special 11th Division affirmed the administrative liability of Notre Dame de Chartres Hospital for failing to properly apply these benefits to the bills of qualified senior citizen patients.

The appellate court ordered the hospital to refund a total of P908,116 to affected senior citizens, ruling that the improper billing practices resulted in excess out-of-pocket expenses that must be returned to the patients.

Records showed that several complaints were filed against the hospital in 2018 for allegedly failing to correctly deduct the mandatory senior citizen discount and VAT exemption from hospital bills.

While affirming the hospital's liability, the CA reduced the administrative penalty previously imposed by PhilHealth. Instead of the earlier P7.7 million penalty, the court ordered the hospital to pay a fine of P70,000.

According to records from PhilHealth's arbitration office, the hospital was found liable for 77 violations, each carrying a penalty of P100,000. The PhilHealth Board of Directors later upheld the ruling.

However, the appellate court ruled that the case should be treated as a single administrative violation rather than 77 separate violations, resulting in a substantially lower fine.

The ruling serves as a reminder that senior citizen discounts and VAT exemptions are legal rights guaranteed by law and that healthcare institutions are obligated to comply with these protections.